Foodservice Equipment Reports Fortnightly

Welcome to FER Fortnightly Online Newsletter
September 10, 2009

Regulatory Report:
Sponsored by:
Manitowoc Ice Inc.
Some Broilers May Get Break In San Joaquin
More Twists In San Francisco's Healthcare Case
Three Tries And FOG's In, Not Out
New Utah Bar Laws A Good-News-Bad-News Story
Comment Period On Smart Irrigation Now Open

Industry Report:
Sponsored by:
Server Products
ASTM To Offer Lifecycle-Costing Webinar Next Week
Checkers Finds New Franchisees, New Locales
Burgerville Hits The Road
Einstein Spreads Wings
Russia To Get First Chili's

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In This Section:
Public E&S Manufacturers Report Big Sales Drops For Q2, H1
NRA Performance Index Ticks Back Up In July
Think We Have it Bad? Other Major Foodservice Markets Get Hammered
FER E&S Market Forecast Webinar Set For Nov. 4

This issue's Regulatory ReportSponsor: Manitowoc Ice Inc.
Industry ReportSponsor: Server Products
Economic Report Internorga 2010

By Robin Ashton

Public E&S Manufacturers Report Big Sales Drops For Q2, H1

Yes, the market for foodservice equipment and supplies was ugly the first half of this year. Seven big public E&S companies saw blended organic revenues decline 14.2% in the second quarter. The figures are compiled by John Muldowney, principal at Clarity Marketing, Tipp City, Ohio. Blended sales for the first half fell 12.2%, Muldowney reports.

The drop is remarkably close to the 14% decline in U.S. sales charted by the Manufacturers' Agents Association for the Foodservice Industry's Business Barometer for the second quarter. Including Canada, sales fell 12.8% in the quarter, MAFSI earlier reported.

Of the seven public companies tracked, the five equipment-oriented ones were hit harder than the two supplies-oriented organizations. Blended sales for the equipment companies fell 14.8% in the second quarter. Three of the five saw double-digit declines. For the first half, the equipment companies reported sales dropped 12.4%.

The two supplies companies were off a combined 11.8% in the second quarter and 11.1% for the first half.

Anecdotal reports peg the current third quarter to be down again, though some say sales have not fallen as aggressively as in the second quarter. The manufacturers' reps surveyed by MAFSI forecast the third quarter will be off 11%.


Section sponsored by Internorga 2010

NRA Performance Index Ticks Back Up In July
The Restaurant Performance Index maintained by the National Restaurant Association gained 0.3 point in July. The uptick followed three months of declines. Both the Current Situation Index and the Expectations Index rose slightly, but both indexes, as well as the overall RPI, remained below the 100 level that signifies the balancing point between contraction and expansion. The RPI fell below 100, indicating contraction, in November 2007, 21 months ago, and has stayed there since.

All of the eight components of the RPI, except the two tracking capital expenditures, rose in July. In the Current Situation Index, which overall showed a 0.2-point gain, same-store sales were up 0.7 point. Traffic rose 0.5 point. The labor component rose 0.2 point.

In the Expectations Index, the anticipated same-store sales measure also rose 0.7 point, as did the future staffing component. Expected business conditions saw a 0.8-point gain. All three components appear to signal that operators have become a bit more optimistic.

Both capital-expenditure components, one tracking purchases made during the past three months and another measuring anticipated purchases the next six month, fell 0.4 point.

Section sponsored by Internorga 2010

Think We Have it Bad? Other Major Foodservice Markets Get Hammered
We've all know for a long time that the U.S. foodservice market is the largest and most dynamic in the world. Now it appears to be the most durable and resilient, as well. A report from NPD shows that other leading foodservice markets in Europe and Asia saw much more severe drops in traffic and sales during the first quarter of this year than the U.S. and Canadian markets did.

The NPD report says traffic declined in seven of the eight major economies it monitors during the first quarter, with U.S. restaurant traffic down 1.5%. Only Canada managed a gain, and just barely, at 0.1%. Most other market saw big traffic declines, led by a 5.5% fall in the U.K. and a 4% decline in Spain. Both economies have also been severely affected by the housing meltdown.

Traffic declined 3.9% in Germany, 3.6% in Japan, 1.7% in Italy and 1.5% in France. Some of the traffic declines were offset by larger average checks in the Canada, France, Germany, the U.K. and United States. The other countries saw checks averages fall.

"It appears this economic downturn has affected consumers similarly, regardless of the country in which they live," said Bob O'Brien, senior v.p. of global foodservice at NPD.

NPD also released in May its first CREST report on the Chinese restaurant market. NPD noted Chinese consumers eat outside the home at least once every other day. In the capital cities, such as Beijing, Shanghai and Hangzhou, they are most likely to visit quick-service or vendor concepts, while in other parts of the country and other big cities, they are more likely to patronize full-service concepts.

For more information on NPD products and research, visit

Section sponsored by Internorga 2010

FER E&S Market Forecast Webinar Set For Nov. 4
In these challenging times, you're very busy. You also need to know what's going on and what's likely to happen. So set aside an hour or so to attend Foodservice Equipment Reports' E&S Market Forecast Webinar

FER Publisher Robin Ashton and forecasting partner John Muldowney, principal of Clarity Marketing, Tipp City, Ohio, will present a revised version of the FER forecast for 2010 through a Web-based seminar Nov. 4, to begin at 1 p.m. Central Standard Time. The presentation will run about an hour and 15 minutes and will provide an overview of general economic, operator and materials-pricing trends, historical E&S pricing trends from AutoQuotes Inc. and the magazine's hard-number forecasts of nine separate E&S product categories for both '09 and '10.

All participants will also receive an updated version of the entire six-section forecast in PowerPoint format, including an overview of the Top 150 E&S manufacturers from Muldowney.

The seminar fee is $349. Those who have attended the FER forecast or other FER meetings, or have purchased the forecast in the past, will receive a discount. Those who attended the forecast seminar in August this year can attend the seminar and receive the updates for no charge.

If you can't wait until November, the current forecast package, presented at the magazine's annual forecast seminar Aug. 5, is available in six PowerPoint decks for $449. To order or for information on participating in the forecast webinar, e-mail Robin Ashton at or Chris Palmer at, or call the magazine at 800/986-9616.

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